Vodacom upgrades growth targets after completing Safaricom acquisition

Details: Manny Pham; Category: Operators; 27 July 2026; 595 views

Vodacom Group has reported higher first-quarter revenue and service revenue, supported by strong performances in Egypt, its international operations and financial services, as the operator completed its acquisition of a controlling stake in Safaricom.

For the quarter ended 30 June 2026, group revenue increased 5.9% year-on-year to ZAR42.4 billion, while service revenue rose 6.3% to ZAR34.3 billion. On a normalised basis, which excludes foreign exchange effects, service revenue grew 12.6%.

Financial services continued to be a key growth driver, with revenue from the segment rising 17.8% to ZAR4.5 billion. Including Safaricom, Vodacom's mobile money platforms processed transactions worth US$547.9 billion over the past 12 months.

The operator said the acquisition of an additional 20% stake in Safaricom, increasing its shareholding from 35% to 55%, became effective on 30 June and marks a significant step in its Vision 2030 strategy.

As a result of the transaction, Vodacom has raised its medium-term EBITDA and operating free cash flow growth targets from double-digit to early-teens growth. The company also increased its Vision 2030 revenue ambition from more than ZAR200 billion to more than ZAR300 billion.

Group CEO Shameel Joosub said the acquisition strengthens Vodacom's geographic diversification and increases its exposure to higher-growth digital and financial services businesses across Africa.

"Normalised group service revenue growth of 12.6% remains on track to deliver our medium-term ambition of double-digit growth," he said.

Egypt remained Vodacom's fastest-growing market, with service revenue increasing 32.8% in local currency, supported by spectrum and network investments. Financial services revenue in Egypt grew 73%.

South Africa recorded service revenue growth of 2%, with the company noting that its prepaid segment returned to growth following efforts to simplify tariffs and improve customer value propositions.

Vodacom's international business also maintained strong momentum, with normalised service revenue increasing 14%, driven by Tanzania, the Democratic Republic of the Congo and Lesotho.

Revenue from businesses beyond traditional mobile connectivity, including financial services and fixed broadband, totalled R7.8 billion during the quarter, representing 22.8% of group service revenue. Financial services remained the largest contributor, underlining the company's increasing focus on digital and fintech services as it looks to diversify its revenue streams.

Vodacom also highlighted continued investment in fixed broadband through Maziv, including an additional R0.8 billion investment to support the completion of the Herotel transaction, which it said would help accelerate fibre deployment in South Africa.

Following the completion of the Safaricom transaction, the board also updated its dividend policy to a payout of at least 65% of headline earnings, saying the move reflects greater confidence in the group's future growth and cash generation.